Hempstead advances three key development projects

Park place: Hempstead Village's Park Lake Residences affordable-housing community has a new owner and a new tax-incentives package -- and may soon have a new look.

September 20, 2018

By GREGORY ZELLER //

It’s been a busy week in the Town of Hempstead, where local economic-development officials have hit the gas on a multitude of projects.

The Hempstead Industrial Development Agency on Tuesday approved the sale of Park Lake Residences, an affordable-housing complex located in the Village of Hempstead, and the reassignment of existing economic benefits to the complex’s new owner.

The IDA also granted preliminary approval to an economic-benefits package that will allow developers to construct 172 rental apartments on a contaminated former oil-storage facility located in the Village of Island Park.

The LDC – which provides low-interest, tax-exempt bonds to Hempstead-based nonprofits, educational institutions, hospitals, civic entities and charities – announced its preliminary approval of the bond sale in August. Molloy College plans to use the sale to complete the $20.5 million third phase of its Campus Master Plan, including construction of a 27,000-square-foot, 95-bed dormitory on grounds currently covered by a parking lot and undeveloped green space.

Fred Parola: On dorms, affordable housing and long-term blights.

The bond sale is expected to close in mid-October with JPMorgan Chase underwriting the bonds. The bonds are to be repaid by Molloy and are secured by a first-mortgage lien on the land and the new building, according to the LDC, meaning there’s no cost to Town of Hempstead taxpayers.

“These bonds will provide a meaningful boost to Molloy College’s aim to increase enrollment and attract students from outside of the area,” said LDC Executive Director Fred Parola.

Meanwhile, the IDA – which offers tax incentives and other forms of financial assistance to qualifying businesses – approved the $42 million sale of Park Lake Residences from Park Lake Residences LP (an affiliate of New York City-based real estate development firm Omni New York) to Park Lake Owner LLC, Jaffe Family TIC LLC and E. Nelson Family TIC LLC.

The sale includes the transfer of a tax-abatement package the IDA granted to Park Lake Residences LP in 2005, which is not set to expire until 2021. The development agency also granted the new owners – who plan to invest $7 million renovating the 14-building, 240-unit complex – a new 10-year tax-incentives deal, according to a statement from the IDA.

“This complex has provided an affordable place for people to live in the Village of Hempstead for more than 70 years,” noted Parola, who is also executive director of the Hempstead IDA. “Our assistance package will provide continued affordable housing while helping the new owners reinvigorate the complex.”

The preliminary approval issued Tuesday by the IDA involves a plan by Connecticut-based developer AvalonBay Communities to construct one-, two- and three-bedroom apartments at a brownfield site that once served as an oil storage and distribution facility in Island Park’s Harbor Isle neighborhood.

AvalonBay Communities could not afford to remediate the brownfield property – at an estimated cost of $9 million – and build a complex that could withstand a Superstorm Sandy-level event without the economic-benefits package, according to the IDA.

The benefits package is subject to a future public hearing, an environmental review and final board approval. If it’s approved, the cleanup effort will take up to nine months, followed by another 26 months of construction, with roughly 300 construction jobs generated by the project, the IDA said Thursday.

The site, which underwent a zoning change to residential uses in 2009, currently generates only $98,000 in annual property taxes – a total expected to rise considerably once the housing project is complete, according to Parola, a former Nassau County comptroller and New York State assemblyman.

“This site has been a blight in the community for at least 17 years,” the IDA exec added. “These benefits, if ultimately approved by the board, will go a long way in transforming the site while providing much-needed rental housing in the town and bringing significant new revenues to our taxing jurisdictions.”